US President Donald Trump has imposed a 44% tariff on Sri Lanka, citing what he called a “reciprocal discounted tax” based on trade imbalances.
The tax is a response to Sri Lanka’s tariffs and barriers on American goods, which is half of the 88% taxes charged on US products.
Trump’s order specifies that if more than 20% of an article is made with US material, only the remaining balance of the product will be taxed, offering a nuanced approach to how tariffs will be applied to items with significant American content.
In 2024, Sri Lanka’s total exports amounted to $12.7 billion, with nearly $2.9 billion (22.9%) of those exports being purchased by US consumers. This puts Sri Lanka among the countries facing the highest tariffs under Trump’s administration.
President Trump has announced a sweeping set of reciprocal tariffs, imposing a baseline 10 per cent tax on all imports and significantly higher rates on dozens of countries with which the US runs trade deficits.
In a statement delivered from the White House Rose Garden, Trump described the measure as a “declaration of economic independence” and vowed to boost domestic production by levelling the playing field with foreign competitors.
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